Process overview (continue below for step by step):
- Buy Bitcoins on www.localbitcoins.com
- Create an account on the virtual currency exchange, www.cryptsy.com
- Send your Bitcoins to cryptsy from www.localbitcoins.com
- Convert your bitcoins to DogeCoins
- You've got DogeCoins!
- Download and install the DogeCoin Wallet on your computer
- Transfer your DogeCoins to the wallet for safe keeping
- Back up your wallet
- Ride the Doge Rollercoaster!
Many of my friends have been asking recently how I invested in the crypto-currency DogeCoin so I’ve written this step-by-step guide. At the time of writing this you can’t just exchange real money for DogeCoins (unless you buy bundles off ebay or similar, in which case you’ll not get the best deal), so the way I did it at least, was to buy Bitcoins first, then exchange them for DogeCoins.
Before You Start - Some Answers to Frequent Questions
- Note: Don't have a heart attack when you see the price of a BitCoin, you don't have to buy a whole one!
- I'll talk about buying BitCoins via Bank Transfer. The website I'll guide you through uses a service called Escrow, which makes the process more secure and less nerve-racking for you when you send your money to a stranger!
- My online banking with Natwest at least only lets you do instant UK bank transfers 9am-5pm Mon-Fri. Outside of these times the transfers are scheduled for the next time period. This means to transfer money to a BitCoin Seller, you may have to do it at work as you need to make the payment within 90 minutes.
- You'll need to add the seller as a payee in your online banking. To do this on my Natwest online banking I need to use a little card reader device, so make sure you have everything you need with you when you come to set up and make the transfer.
Step 1 - Buy BitCoins on www.localbitcoins.com
This step will see you exchange your hard earned, real cash for BitCoins, the crypto-currency that kicked off this whole shebang, ready to convert into DogeCoins. We will pay with a bank transfer via online banking.NB: Whole BitCoins are expensive, like over £500 each at the time of writing this, but don't worry, you don't have to buy a whole one.
Step 1 overview:
- a) Create a free www.localbitcoins.com account
- b) Decide how many pounds you want to spend and choose a seller
- c) Start a trade
- d) Your security and peace of mind when about to transfer money
- e) Use your online banking to transfer your money to the seller's bank account (read on for security information)
- f) Receive the BitCoins into your localbitcoins.com account
a) Create a free www.localbitcoins.com account
Sign up for an account at www.localbitcoins.com. Local Bit Coins allows you to either buy BitCoins by bank transfer (or a few other payment methods) or to meet people in person. I opted for the bank transfer method so this is what I'll describe.After creating an account, the main buy screen will look something like this (click to enlarge):
b) Decide how many pounds you want to spend and choose a seller
You may see different options under 'Payment Method', including Bank Transfer, Perfect Money and OKPay. This guide focuses on the bank transfer method.You'll see in the Limits column the minimum and maximum amount of GBP they'll accept for a trade. If everyone's limits are too high for what you're currently looking to invest, or you just want to see more offers, click the 'show more' link at the bottom right of the above screenshot and select 'All in United Kingdom'.
The Price / BTC column shows you how many pounds they are selling 1 BitCoin for (yes they're expensive!). You don't have to buy a whole one, you can spend whatever you like within the limits that the seller will accept. I spent £55 on my first purchase, which got me about 0.1 BitCoins. I didn't pay too much attention to the differences in offered price as at the fraction of a BitCoin I was buying the affect to the cost was negligible.
Click 'Buy' on the right next to one that you're interested in. On this next page you get a bit more information about the seller and clicking on their username takes you to their profile where you can check out their feedback in greater detail.
c) Start a trade
At the top right of the screen (not pictured above, but just to the right of that on the screen) is a box where the seller can write their specific terms of trading with you. They might give you information about when they're available, how long to expect to wait for your BitCoins after paying, or give you advice on how long bank transfers can take from certain banks. Make sure there's nothing crazy in there!
If you're happy to proceed (we'll get to the bit about security shortly), type in the number of pounds you want to spend in the GBP box and it will automatically calculate the number (or fraction) of BitCoins you're buying at the seller's offered rate.
You may find that some sellers require you to go through the extra validation process using your mobile phone before they'll trade with you, although it looks to only be when they're only trading in very high amounts.
I've never written a specific contact message in the optional box, so when you're ready click 'Send Trade Request'.
d) Your security and peace of mind when about to transfer money
The Local BitCoins website provides a service called Escrow.
As soon as you hit the 'Send Trade Request' button, the seller is alerted and the number of BitCoins you want to buy is 'held' by the Local BitCoins website.
When you've transferred your money to the seller (explained shortly), they release the Bit Coins to your Local BitCoins account. If you pay and don't get your BitCoins, LocalBitCoins is in control of them at that point until everything is resolved. It stops con artists from simply walking away with your money and the BitCoins.
At the end of the day the sellers are on there to make money from selling their Bit Coins and rely on positive feedback and repeat customers.
e) Use your online banking to transfer your money to the seller's bank account
When you've clicked 'Send Trade Request', you'll be given the seller's bank account sort code, account number and a unique reference number. It requests that you make the payment within 90 minutes.
With Natwest at least, online banking payments that I make are instant, but only occur 9am-5pm Monday to Friday. When I try to transfer money outside of these times they are delayed until the next period starts. In order for the seller to receive their payments within 90 minutes, I therefore need to make the transfer within this time period, so usually on a lunch break at work.
NB: I've seen one seller state that Santander and HSBC bank transfers usually take a couple of hours. If you use these banks, message the seller on the right hand side of the screen after you've requested the trade and tell them. I imagine they can increase the time window.
At this point you'll need to log into your online banking and add them as a payee so you can send money to them. With Natwest, I have to use a little card reader device to add a payee.
The reference number you're given allows the seller to match your payment to the trade on LocalBitCoins. You'll be asked for a reference at some point when making the payment through your online banking. You get a different reference number each time you trade.
NB: With Natwest, it stores reference numbers against the payee when you add them, rather than asking for a reference number for each transaction with them. If you do a second trade with Natwest to the same person, you'll have to go into that payee and update the reference number against them BEFORE you make the payment.
So, add the person as a payee in your online banking using the sortcode and account number provided on LocalBitCoins and make the payment being sure to include the reference number given.
You may notice on the right hand side of the screen in the messaging section, the seller might say something like 'ready to trade' so you know they're at their PC and they'll act quickly after receiving your payment.
You may notice on the right hand side of the screen in the messaging section, the seller might say something like 'ready to trade' so you know they're at their PC and they'll act quickly after receiving your payment.
When you've made the payment through online banking, click the 'Mark payment complete' button on LocalBitCoins.
f) Receive the BitCoins into your localbitcoins.com account
Now you wait.When the seller sees your payment in their bank account, they will tell LocalBitCoins you've paid, and the website will release your BitCoins into your LocalBitCoins account.
Depending on how long it takes your bank to transfer the money, and whether the seller is making a cup of tea, it can take anywhere from 5 minutes to an hour or so before this happens. It's always been under 10 minutes for me.
When your BitCoins have arrived, you'll see it say Wallet: xx BTC at the top left of the LocalBitCoins website. (I don't have any in my LocalBitcoins wallet at the moment but include the picture so you know where to look).
You'll see the term 'wallet' come up a lot when dealing with these virtual currencies. A wallet is where your currency lives. A wallet can be online in a website such as LocalBitcoins, or it can be a program on your computer. You move your currency between your wallets using special wallet addresses. We'll go through all of this later so don't worry for now. Know that you've successfully bought some Bitcoins and move on to step 2.
Step 2 - Create an account on the virtual currency exchange, www.cryptsy.com
Leave your Bitcoins in your LocalBitcoins account for the moment.We're going to create an account on www.cryptsy.com and then transfer your Bitcoins into it so you can trade them for DogeCoins.
www.cryptsy.com is an online exchange for virtual currencies. Bitcoins and DogeCoins are one of MANY virtual currencies, so don't get put off and feel overwhelmed by seeing all of the other types listed on Cryptsy.
NB: I trust Cryptsy 100%. It has been a bit slow sometimes in transferring my currency in and out, but as a web developer myself, I can only imagine the challenges they face with the growing number of users and transactions they are supporting. If you read up on Cryptsy, in the past they've experienced some problems because of these challenges which has really annoyed some people who feel they've been cheated. While I can't comment on their individual experiences, I've not experienced any problems myself.
Register for a new account on www.cryptsy.com. You have to provide security questions and answer one of those Captcha codes, thankfully it's just numbers so not too bad. Note that there are two sets of numbers, some black text on white and then a picture with numbers in. I missed the picture the first time because I was rushing and wondered why it wasn't working.
You'll have to check your email and click a link to confirm your account.
I can't quite remember if you're asked if anyone referred you when you're signing up. If so, I'd appreciate it if you'd copy and paste my referral key in so I'll get some 'Cryptsy Points'!
My Cryptsy referral key, if you'd be so kind: dded73606bf966403d6b411574c548af146ae21b
You can also do this at any time after signing up by going to the dashboard page and copying and pasting the above code into the 'I Was Referred By:' box. Many thanks!
Step 3 - Send your Bitcoins to cryptsy from www.localbitcoins.com
We're going to find the 'address' in Cryptsy that you need to tell LocalBitcoins to send your Bitcoins to.On www.cryptsy.com:
When logged into your Cryptsy account, click on 'Balances' at the top of the screen.
Here you'll see a great long list of all the virtual currencies supported by Cryptsy. Scroll down to BitCoin , click on the green 'BTC Actions' button on the right and click 'Deposit / Autosell BTC' in the little menu that pops up underneath. Ignore the fact I have a tiny BitCoin balance in the picture below, it is left over from buying DogeCoins. Yours will read 0.0000000 all the way across.
A small window will pop up in the middle of the screen. You'll have to excuse me I can't remember if there's already a long blue piece of text in the 'Your Deposit Address' box when you first see this window. If not, click the green "Generate New Deposit Address" button and a new, blue, long and ugly looking piece of text will appear in the "Your Deposit Address" box in the middle of the screen.
Either highlight this text and copy it to your clipboard (hold the Ctrl key and press 'c' on a PC, or right click it when highlighted and choose copy) or click the tiny icon to the right to copy it to your clipboard for you.
This long garbled looking piece of text is a unique address to send your Bitcoins to so they'll show up in your Cryptsy account.
Back on www.localbitcoins.com:
Back on LocalBitcoins, click at the top left of the screen where it says 'Wallet: xx BTC'.
This will take you to the 'Send bitcoins' page:
In the 'Receiving bitcoin address' box at the top, paste in the Deposit Address you just copied from your Cryptsy account (having clicked in the box, either hold Ctrl and press 'v' if on a PC, or right click in the box and click paste).
In the amount, type how much you want to send to Cryptsy. Because I was new to all of this and cautious I tried with a small amount first just to make sure it showed up in Cryptsy first. I'll leave that up to you!
Finally type your LocalBitcoins account password in from when you created your account earlier
Click the 'Send from wallet' button.
Now you wait again!
The first time it took a good few hours before there was any sign of my BitCoins in my Cryptsy account and even then the deposit was still 'pending', I couldn't do anything with them at that point.
Back on the 'Balances' page in your Cryptsy account, look at the column names along the top. One is 'Pending Deposit'. Scroll down to BitCoin and you'll first see signs of your incoming Bitcoins listed in this column. As I said, this took a few hours for me. Until then my Bitcoins were floating about in the ether. Don't worry, they'll turn up.
Update: My latest deposit took only 20 minutes to show in the 'Pending Deposit' column, and then just over an hour to be fully cleared. It really does depend on how busy Cryptsy is.
When everything had settled, my Bitcoins were listed in the 'Available Balance' column on Cryptsy's 'Balances' page.
Now comes the main event!
Step 4 - Convert your Bitcoins to DogeCoins
Your Bitcoins are in your Cryptsy account so let's convert them into DogeCoins!
While logged into your Cryptsy account, click on 'Trade' at the top.
Scroll down to DOGE/BTC and click on it:
At the top of the DOGE/BTC trading page you'll see a graph of how DogeCoin's value has compared to BitCoin recently.
What we're interested in though is the BUY DOGE with BTC box underneath the graph.
NB: DOGE is the short name for the DogeCoin currency, like GBP is short for Great British Pounds.
At the bottom of this box you'll see the BitCoins you have available for buying DogeCoins. It will be a lot more than I currently have in the screenshot, which is what's left over after my last trade.
First off, notice that Cryptsy charges a small fee, 0.20% of your trade amount. I think this is very reasonable for the service they provide, and you'd expect to pay a fee if dealing in shares on the stock market anyway.
Start by typing an amount of DogeCoins to buy in the top box. Remember there are many DogeCoins to a penny at this point, so start with something like 100000 DogeCoins and see what the total is compared to the amount of BitCoins you have available.
It would be nice here to be able to enter the amount of Bitcoins you want to spend and it calculate how many DogeCoins you can buy with that, but you can't at the moment.
Notice you can also change the Price Per DogeCoin. This defaults to the going market rate for DogeCoins vs Bitcoins. While from your point of view you're just buying DogeCoins for a set amount, in the background Cryptsy is busy matching Buy requests with Sell requests. You can try putting a lower amount per DogeCoin in here, and providing someone is willing to sell at the rate you're asking, you should get the trade. I didn't understand this the first time and so just left it as it was. I had no trouble buying the DogeCoins at the going rate
When you've decided on the amount of DogeCoins to buy, press the 'Submit Buy Order' button.
After doing that, wait a short while, and depending on how busy Cryptsy is, before long you should see a small green message box popup at the bottom-left hand side of the screen confirming your order has been placed.
You can see the state of your order by visiting the 'Open Orders' page at the top of Cryptsy.
If you go back to your Cryptsy 'Balances' page, you'll see that your Bitcoin 'Available Balance' will have decreased, and the amount you're spending is listed in the 'Held for Orders' column.
It's time to wait again while Cryptsy fulfils your order. It could take minutes, it could take hours, all depending on how busy Cryptsy is. Bear with it. You're almost there!
It's time to wait again while Cryptsy fulfils your order. It could take minutes, it could take hours, all depending on how busy Cryptsy is. Bear with it. You're almost there!
Step 5 - You've got DogeCoins!
When the dust has settled, your 'Balances' page on Cryptsy will list your newly acquired DogeCoins in the 'Available Balance' column.
Congratulations! You've done it! You're a player in the game of DOGE!
Should the value of DogeCoins now go up the value of your investment will increase. There are just a couple more things to do now before you can relax...
Step 6 - Download and install the DogeCoin Wallet on your computer
I've invested in DogeCoins for the long haul so I want to know they're safe. The way to do this is store them in a wallet on your own computer where you can take a backup, or three.
Go to www.dogecoin.com, the official website of DogeCoin.
Underneath where it says "Start using DogeCoin Today", click on the link for your operating system. I use windows so that's the one I chose.
It downloads as a .zip file, so you'll need to create a new folder somewhere, on your desktop's fine, and copy the files into it out of the zip folder.
Double-click the dogecoin-qt.exe file to open your DogeCoin wallet.
When you first do this, it has to download a file that lists EVERY SINGLE transaction that has ever occurred with DogeCoins. This file is huge and can take the best part of a day. I probably should have told you to do this first come to think of it!
You don't need to worry about how all this works. Just let it do its thing.
This file is the same for everyone and is the one true record of who owns DogeCoins and how many of them. Everyone needs this file in order to keep the system in check.
You can see the progress of this download in the form of a green bar at the bottom left hand corner of your DogeCoin wallet.
While your DogeCoin wallet program is downloading this huge file, you will see a message saying 'Out of Sync'. As soon as the download has finished, give it a few minutes to sort itself out and everything will be ready to go. You may occasionally see the 'Out of Sync' message again, but give it a few minutes and it will sort itself out.
Step 7 - Transfer your DogeCoins to the wallet for safe keeping
In order to receive DogeCoins into your DogeCoin wallet from Cryptsy, we need to get the address of the wallet you just installed and tell Cryptsy to send our DOGE there. Wallet addresses look like those ugly long pieces of text you copied and pasted into LocalBitcoins from Cryptsy. Your wallet can actually generate as many receiving addresses as you want so you can give different people or websites different addresses to keep track of who's paying you.
By now you will probably have seen some strangely written English surrounding the world of DogeCoins. That is because the Dog Character that the currency is based around, doesn't speak English very well and is very excited by everything. Much explanation!
To find a receiving address for your wallet, click on 'Much Receive'.
Click on 'New Address'. It will ask for a Label, or name for this address. In this instance, call it something like 'From Cryptsy' and click 'OK'.
You'll see 'From Cryptsy' appear in the list along with a new long garbled looking piece of text in the 'Address' column. This is what we want to tell Cryptsy about.
Right click on the long garbled address and click 'copy address' in the small menu that pops up.
If you'd like to give me a DogeCoin tip if this guide has helped you, my receiving address is:
DDBQ8SApjixnJRayasharHejh9pieRwgpm
Thanks!
Go back to www.cryptsy.com.
Click on 'Balances' at the top when you're logged in.
Scroll down to Dogecoin where it lists how many you have, click the right hand side green 'DOGE Actions' button and select 'Withdraw DOGE'.
The window that comes up confirms how many DogeCoins you have available.
Type in the 'Amount DOGE' box how many you want to withdraw. You'll notice that they charge a fee of 0.1 DogeCoin for withdrawing your coins. This is equivalent to a fraction of a penny so you can't really complain!
Paste the address from your DogeCoin Wallet into the 'DOGE Withdrawal Address' box.
Type your Cryptsy password in to prove you're you.
Fill in the Captcha to prove you're not a thieving robot.
Press 'Process Withdrawal'.
IMPORTANT: At this point, Cryptsy will send an email to the address you signed up with. There is a link in this email address that you must click in order to confirm the withdrawal to your wallet. The subject of the email is 'Confirm your Withdrawal' and I ignored it to start with because I misread it at a glance as 'Confirmation of your Withdrawal'. You must click the link in this email to release your DogeCoins.
My first withdrawal took around 8 hours to show up in my DogeCoin Wallet. The second took 40 minutes. It depends on the size of the withdrawal, how busy Cryptsy is, and I think how many withdrawals you've done, with it being slower the first time as they do more checks.
AGAIN YOU WAIT!
Note that your Wallet doesn't have to be open and running on your computer to receive your coins. Because every transaction is recorded in the large file that powers your DogeCoin wallet, your coins are allocated to your wallet's receiving address which will then pick them up the next time you open the wallet. Just give it chance to synchronise up.
When everything's done and dusted, your DogeCoins will be safely in your DogeCoin wallet.
It's very simple to backup your wallet.
Should I need to restore them, or move the PC that my wallet's on, I follow Step 6 above again, then because I'm on Windows 8:
Even when you unzip the DogeCoin Wallet files to a folder on your desktop and run the wallet, it installs files to the location above. Your backup file is the only thing you have to put there manually (and rename it to wallet.dat).
That's it, breath! You've bought coins. You've got them onto your PC in your own DogeCoin wallet and you've backed them up!
You deserve a biscuit. May I suggest chocolate malted milk?
You'll see 'From Cryptsy' appear in the list along with a new long garbled looking piece of text in the 'Address' column. This is what we want to tell Cryptsy about.
Right click on the long garbled address and click 'copy address' in the small menu that pops up.
If you'd like to give me a DogeCoin tip if this guide has helped you, my receiving address is:
DDBQ8SApjixnJRayasharHejh9pieRwgpm
Thanks!
Go back to www.cryptsy.com.
Click on 'Balances' at the top when you're logged in.
Scroll down to Dogecoin where it lists how many you have, click the right hand side green 'DOGE Actions' button and select 'Withdraw DOGE'.
The window that comes up confirms how many DogeCoins you have available.
Type in the 'Amount DOGE' box how many you want to withdraw. You'll notice that they charge a fee of 0.1 DogeCoin for withdrawing your coins. This is equivalent to a fraction of a penny so you can't really complain!
Paste the address from your DogeCoin Wallet into the 'DOGE Withdrawal Address' box.
Type your Cryptsy password in to prove you're you.
Fill in the Captcha to prove you're not a thieving robot.
Press 'Process Withdrawal'.
IMPORTANT: At this point, Cryptsy will send an email to the address you signed up with. There is a link in this email address that you must click in order to confirm the withdrawal to your wallet. The subject of the email is 'Confirm your Withdrawal' and I ignored it to start with because I misread it at a glance as 'Confirmation of your Withdrawal'. You must click the link in this email to release your DogeCoins.
My first withdrawal took around 8 hours to show up in my DogeCoin Wallet. The second took 40 minutes. It depends on the size of the withdrawal, how busy Cryptsy is, and I think how many withdrawals you've done, with it being slower the first time as they do more checks.
AGAIN YOU WAIT!
Note that your Wallet doesn't have to be open and running on your computer to receive your coins. Because every transaction is recorded in the large file that powers your DogeCoin wallet, your coins are allocated to your wallet's receiving address which will then pick them up the next time you open the wallet. Just give it chance to synchronise up.
When everything's done and dusted, your DogeCoins will be safely in your DogeCoin wallet.
Step 8 - Back up your wallet
Because computers crash, get stolen and get viruses, it's a very good idea to back up your wallet. If you lose the special file that identifies your receiving addresses, you lose your coins!It's very simple to backup your wallet.
- I plug a USB memory pen into the PC with my wallet on
- In the DogeCoin wallet program, click File, then 'Backup Wallet'
- I navigate to my memory pen and type a filename such as [today's date] - [amount of coins]
- Press 'Save' and my Coins are Safely backed up to my memory pen.
Should I need to restore them, or move the PC that my wallet's on, I follow Step 6 above again, then because I'm on Windows 8:
- go to the following folder: C:\Users\[my username]\AppData\Roaming\DogeCoin
- copy in the backup file I saved to my memory pen
- delete the wallet.dat file that comes with the freshly installed program
- rename my backup file to wallet.dat
- open my wallet and let it synchronise for a while
- voilà, my coins and my receiving addresses are there
Even when you unzip the DogeCoin Wallet files to a folder on your desktop and run the wallet, it installs files to the location above. Your backup file is the only thing you have to put there manually (and rename it to wallet.dat).
That's it, breath! You've bought coins. You've got them onto your PC in your own DogeCoin wallet and you've backed them up!
You deserve a biscuit. May I suggest chocolate malted milk?
Step 9 - Ride the Doge Roller Coaster
Now you can enjoy biting all your nails off as you watch the value of DogeCoin jump around like it's possessed!There are a few sites I use to keep an eye on it.
www.bitinfocharts.com - great for an overview and seeing how it fares against other currencies
http://www.coinwarz.com/exchange-charts/dogecoin-exchange-rate-chart - a graph showing DogeCoin value at different exchanges.
Also on my Android phone I have an app called Bitcoin Info. It runs in the notifications window to tell me the current value at any time. I set it to display the value in 'Satoshis' , or 100,000,000ths of a bitcoin so you'll get a number such as '206', rather than something like 0.0000026. I'm too lazy to count the noughts every time!
Step 10 - If this Guide has helped you to buy DogeCoins please consider tipping me a few!
This has been much longer than I intended. It's turned into a bit of a brain dump. I hope it's helped you. If you feel so obliged, please feel free to send a tip in DogeCoins to my wallet address: DDBQ8SApjixnJRayasharHejh9pieRwgpmAlso please feel free to leave a comment.
To the moon!
